Aug. 23 (Bloomberg) -- Diageo Plc, the drinkmaker that gets
5 percent of its sales from Greece, Italy, Portugal and Spain,
said it’s mindful of the risk that a nation may leave the euro
area and adopt a different currency.

“The ongoing sovereign debt crisis in certain countries in
Europe has increased concerns that, were one or more countries
to leave the euro, Diageo’s investment in any countries
concerned could be impaired and may be subject to redenomination
and other risks going forward,” the London-based company said
in an earnings report today.

Euro-region policy makers are undertaking a week of shuttle
diplomacy as they seek to defuse turmoil in the region that has
roiled financial markets for almost three years. Greek Prime
Minister Antonis Samaras told French newspaper Le Monde in an
interview that speculation of a Greek exit must end. The
probability of a country leaving the monetary union by the end
of 2014 is 64 percent, based on bets made at Intrade.com.

“Every multinational or any business operating in the euro
zone needs to consider those risks, just as we would,” Diageo’s
Chief Financial Officer Deirdre Mahlan said today on a
conference call. “We are watching carefully Spain and Italy,
managing working capital, and working with strong banking
partners.”

Diageo, which sells brands including Guinness stout and
Smirnoff vodka, said today that revenue increased 6 percent on a
so-called organic basis in the 12 months through June 30.
Earnings increased 9 percent on the same basis, boosted by a
recovery in demand in the U.S. and sales in emerging markets.

‘Adverse Effect’

Lower economic growth in Europe “could have a material
adverse effect on Diageo’s business,” the company said in the
earnings statement. The euro-region is forecast to contract 0.5
percent this year, according to analyst estimates compiled by
Bloomberg.

Greece, Italy, Portugal and Spain, which are all in
recessions, represent 5 percent of Diageo’s net sales globally,
according to the statement.

“These southern European markets declined 6 percent in
volume and 9 percent in net sales as deeper austerity measures
put additional pressure on consumption and sales mix,” the
company said.